Return to Article: Thrifty at the Thrift Plan
-
4500
Mr A is amazing. He attributes the spending of less than budget as a good thing that reflects good management. I think it reflect poor management! The fact that the budget could not correctly account for lower exenses because participants took electronic statements is poor management. The cost should not be based on the size of the investment, it should be a fixed dollar amount! The costs to the fund do not vary with investment size. Statements cost the same to produce for accounts of $100 as for accounts of $1,000,000. Likewise, the costs to invest the funds depend upon the number of transactions and very little on the size of the transactions. Finally, setting up and adminbistering a loan is much more costly than an investment.
Mr A youy need to manage, particularly for the 11 basis points you charge for my money!
1. Get rid of the 11 basis point charge and charge only 2 basis points for the investment dollars.
2. Charge $300 for a loan application and 50 basis points on the outstanding balance of the loan during its life. We should not be subsidizing borrowers in the thrift plan - borrowing is not thrift!
3. Charge every account $35 per paper statement. Charge each account an annual fee of $100 and $5 per transaction. A transaction would be defined as each contribution, each transfer between accounts, withdrawal from the account for any reason, and any other change to the account (beneficiaries, etc). Charge the government for their contributions as transactions.
4. Provide statements every six months by paper.
There is a far far better way to charge for the services of the thrift savings plan. What private industry does is not the example for the government program to follow because the private sector is out to maximize its return on investment.
-
4437
I would just as soon have the Teamsters managing the Thrift Savings Plan. Does anybody have their toll free line?
Me at Home on My Computer
A TSP Participant
PROMO RIGHT: EVENTS
UPCOMING WEBINARS
NOVEMBER 18
Speed bumps for Teleworking: What are they and how to avoid them?
DECEMBER 3
Achieve Program Success: Unlock the Management Information in Your Data
DECEMBER 10
Practical Transparency: Applying Exchange Networks for Mission Results
PROMO RIGHT: DIRECTORIES
Post a Comment
To post a comment, you must provide a name and a valid e-mail address. Messages must be limited to 400 words. By using this Service you agree not to post material that is obscene, harassing, defamatory, or otherwise objectionable. Although Government Executive does not monitor comments posted to this site (and has no obligation to), it reserves the right to delete, edit, or move any material that it deems to be in violation of this rule.